Earnings Preview: Goldman Sachs (GS) NYSE; Wells Fargo (WFC); BBBY


  • Q1 2021 earnings season kicks off on Wednesday.
  • Goldman Sachs, Wells Fargo and Bed Bath & Beyond are the highlights.
  • Analysts are bullish, predicting a 25% earnings gain for Q1 2021.

Earnings season kicks off again on Wednesday with financial stocks taking centre stage this week. Goldman Sachs stock will garner the most attention on Wednesday as GS reports Q1 2021 earnings. Goldman Sachs reports before the market opens on Wednesday at 0730 EST / 1230 UK time. Goldman traditionally leads the other investment banks, so it will be closely watched. Commentary around the recent Archegos developments and trading volumes going forward after the retail frenzy will also be key. It is importnant to focus on how each measures up, what is expected, and what the shares have done in the past.

While Goldman is the big headline-grabber on Wednesday, there is a return to the retail memes when Bed Bath & Beyond (Nasdaq: BBBY) reports. Bed Bath & Beyond captured the zeitgeist in January as a member of the meme stock brigade and saw sharp volatility. Results could provide some swings. BBBY stock earnings are released before the open with no time confirmed. The post-release earnings conference call is scheduled for 0800 EST / 1300 UK time.

Wells Fargo (NYSE: WFC) completes Wednesday's lineup. WFC reports before the market opens.

Analysts have penciled in some pretty tough acts to follow for the upcoming quarter. Refinitiv data shows Q1 earnings are expected to rise 25% from a year earlier. This is a like-for-like comparison as the pandemic effects had not fed through. Refinitiv also shows that so far 21 of S&P 500 companies have already reported Q1 2021 earnings, and 81% have beaten analyst forecasts.

The chart from Refinitiv below shows the tech sector having the largest number of upward revisions to estimates, while the financial sector is close behind.

Goldman Sachs stock

Goldman (NYSE: GS) is to report before the market opens on Wednesday. Analyst consensus for earnings per share (EPS) is $10.22 with revenue of $12.61 billion. Goldman Sachs has strongly surprised to the upside over the last three quarterly earnings releases. EPS outperformance was 61% for Q4 2020, 74% for Q3 2020, and 65% for Q2 2020. It is not since this quarter last year that Goldman Sachs missed estimates, and even then only marginally. 

Goldman shares actually dropped on the last earnings date, January 19. Despite EPS beating by 61%, GS shares fell by over 2%. GS shares rallied on the earnings release from $300 to $310 but fell for the remainder of the pre-market and regular session. It was a similar situation for Q3 2020. EPS beat estimates by a huge margin, 74%, but Goldman shares fell after the announcement.

GS said in the aftermath of the last results that capital market activity would likely slow down and that Goldman's consumer business subsidiary Marcus was taking longer to turn a profit. Commentary again around Marcus consumer lending will be watched, despite that currently it accounts for less than 3% of Goldman's revenue. 

Goldman Sachs is scheduled to report earnings at 0730 EST / 1230 UK / 1330 CET

GS

Wells Fargo stock

Wells Fargo (NYSE: WFC) will also report on Wednesday before the market opens. WFC is expected to announce EPS of $0.70 and revenue of $17.5 billion. Wells Fargo stock has not had the same stellar track record of outperformance that Goldman Sachs has shown. In fact, WFC has missed all expectations for 2020, barring the final quarter when it marginally beat estimates. Wells Fargo released Q4 2020 results on January 15 when it beat EPS by 7% and revenue missed expectations by just 1%. However, the Wells Fargo stock price took the news badly and closed down nearly 8% post-release. 

In mid-October 2020 Wells Fargo released its previous numbers. On this occasion EPS missed by 6.6%, while revenue beat by 5%. The stock again reacted negatively and closed 6% lower.

Wells Fargo Bank is due to report earnings before the market opens on Wednesday, but no exact time has been released. 

WFC

Bed Bath & Beyond stock

Bed Bath & Beyond (Nasdaq: BBBY) is expected to also release earnings before the market opens on Wednesday. It would seem nobody fancies working late on Wednesday.

BBBY earnings are expected to show EPS of $0.31 and revenue of $2.6 billion. The last number of earnings releases from Bed Bath & Beyond have all been volatile with wide beats and misses versus consensus expectations. BBBY has been one of the meme retail favourites for 20201, and the shares have also been highly volatile. The last set of results for Bed Bath & Beyond were released on January 7. The results were disappointing as both EPS and revenue missed Wall Street analyst expectations. BBBY shares dropped 10% after the earnings release. This was just before retail interest in the shares really took off, so expect more volatility this time if earnings miss or beat by a large margin. 

BBBY shares appreciated from around the $20 level to a high of $53.90 during peak R/WallStreetBets fervour. BBBY shares have since retreated to just under $30 as the retail traders found other stocks to trade and the overall volume of retail flow has decreased as the economy reopens.

BBBY

First Republic Bank 

Finally on Wednesday First Republic Bank (FRC) reports earnings for Q1 2021 before the market opens. First Republic will not grab as many headlines as the more high-profile names above but will still give clues for the retail banking sector. First Republic Bank is expected to report EPS of $1.54 and revenue of $1.09 billion.

 

At the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

This article is for information purposes only. The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice. It is important to perform your own research before making any investment and take independent advice from a registered investment advisor. 

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to accuracy, completeness, or the suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. The author will not be held responsible for information that is found at the end of links posted on this page. 

Errors and omissions excepted.

 

 

 

 

 

 

 

 

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Are you new to trading or have been trading for a while and you feel stuck?

Try with us!
Become Premium!
   

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD clings to 1.20 amid cautious mood

EUR/USD is trading around 1.20 as markets remain cautious amid concerns around rising inflation and supply chain issues. ECB President Lagarde’s speech, US Jobless Claims are awaited.

EUR/USD News

GBP/USD battles 1.39 ahead of the BOE's Super Thursday, Scottish election

GBP/USD is trading around 1.39 ahead of the BOE's "Super Thursday" rate decision where tapering of bond buys is speculated. Elections in Scotland are also eyed.

GBP/USD News

XAU/USD bulls await a sustained strength beyond $1,800 mark

A combination of factors assisted gold to regain positive traction on Wednesday. Wednesday’s softer US macro data weighed on the USD and remained supportive. Move beyond $1,800 is needed to confirm bullish bias ahead of Friday’s NFP report.

Gold News

Litecoin Price Forecast: LTC eyes 22% advance to test its all-time high

Litecoin price surged 16% over the last 24-hours, indicating an uptick in bullish momentum. A minor retracement to the weekly demand zone extending from $217 to $304 will most likely propel LTC to an all-time high at $420. On-chain metrics hint at increased interest among investors over the last couple of weeks.

More Cryptocurrencies News

With a million new jobs looming, why can’t the dollar rally?

The U.S. dollar kicked off the first trading day of May with broad-based losses. On Friday, U.S. non-farm payrolls are due for release and with the labor department expected to report a million new jobs, some investors are wondering why the U.S. dollar is unable to rally.

Read more

Forex MAJORS

Cryptocurrencies

Signatures